Koil Energy Deepens Gulf Presence with Major Subsea Contract

HOUSTON, TX – January 12, 2026 – Koil Energy Solutions, Inc. (OTCQB: KLNG) has secured a significant contract with an unnamed U.S. oil company, a move that reinforces the Houston-based firm's growing influence in the highly competitive subsea equipment market. The deal involves the delivery of a complete, integrated subsea distribution system for a deepwater project in the Gulf of America, signaling continued robust investment in the region's energy infrastructure.

The contract win is a major validation of Koil Energy's strategic pivot towards providing comprehensive, integrated system solutions rather than just individual components. It positions the company as a key player in enabling the complex subsea tie-back projects that have become central to the operational strategy of major oil and gas producers in the Gulf.

A Strategic Win in a Competitive Arena

The scope of the contract is extensive, tasking Koil Energy with the engineering, procurement, fabrication, and testing of a sophisticated subsea system. The company will manufacture critical hardware including subsea umbilical termination assemblies (SUTAs), hydraulic distribution manifolds (HDMs), steel tube flying leads (STFLs), and their foundational mudmat structures.

Crucially, Koil's service team will also manage the integration and testing of the entire system. This includes not only their own manufactured equipment but also components from other leading subsea suppliers. This system-level responsibility is a significant differentiator in a market dominated by giants like TechnipFMC, Aker Solutions, and OneSubsea. By taking on the role of integrator, Koil de-risks the project for its client, ensuring that disparate pieces of complex machinery work together seamlessly thousands of feet below the ocean surface.

"This contract underscores our team’s success in delivering innovative, integrated solutions," said Erik Wiik, CEO of Koil Energy, in the company's official announcement. "Our growth strategy is driven by a continued focus on delivering not only exceptional equipment but also integrated system solutions that create greater value for our customers.”

This approach appears to be paying off. For a specialized company with reported revenues of $23.2 million in 2022, a contract described as "significant" represents a substantial boost to its project backlog and provides revenue visibility stretching into 2026. This award builds on previous successes, including multi-million dollar contracts in the Gulf of Mexico and the Asia Pacific region, suggesting a clear upward trajectory in capturing market share within its niche.

Fueling the Gulf's Deepwater Resurgence

The contract arrives as activity in the deepwater Gulf of Mexico shows sustained momentum. Rather than focusing solely on massive, greenfield developments, energy producers are increasingly turning to subsea tie-back projects. This strategy involves connecting newly drilled wells or smaller satellite fields to existing, nearby production platforms and infrastructure.

Tie-backs are a capital-efficient method for bringing new barrels online faster, maximizing the use of established assets, and extending the economic life of mature fields. The system Koil Energy is building—designed to tie back to an existing subsea field and control additional assets like pipeline end manifolds (PLEMs) and trees—is the technological backbone for precisely this kind of development.

The Gulf of Mexico remains a cornerstone of U.S. energy production. The U.S. Energy Information Administration (EIA) has consistently forecast that the region will remain a major contributor to the nation's crude oil supply, with production buoyed by a steady stream of new projects. These deepwater barrels are often considered to have a lower carbon intensity per unit of production compared to other global sources, a key consideration for producers navigating the energy transition. This Koil Energy contract is a tangible piece of the multi-billion dollar investment puzzle that keeps the deepwater Gulf a vital and technologically advanced energy basin.

The Houston Hub: Local Impact and Expertise

All engineering, fabrication, assembly, and testing for this complex project will be executed at Koil Energy's state-of-the-art manufacturing facility in Houston. This decision anchors the economic benefits of the major deepwater contract firmly within the local community, reinforcing the city’s long-held status as the global capital of the energy industry.

The project will support high-skilled jobs across multiple disciplines, from design engineers and procurement specialists to expert welders and integration technicians. It highlights the strength of the regional manufacturing sector and its critical role in the global energy supply chain. By leveraging a vertically integrated supply chain and local expertise, companies like Koil can deliver highly reliable and competitive subsea products with exceptionally fast delivery times, a key advantage in a fast-moving industry.

The final delivery of the complete system is scheduled for the third quarter of 2026. The contract also includes an option for Koil Energy to provide offshore installation services, which, if exercised, would further expand the company's role and deepen its involvement from the factory floor to the seabed.

Integrating for the Future

At the heart of this project is the concept of integration. The components Koil will build are the vital arteries and nerve center of a subsea production field. SUTAs act as the main junction box, connecting the long umbilical from the surface to the subsea equipment. HDMs then distribute hydraulic power and chemical injection fluids to control wellheads and valves, while steel tube flying leads serve as the final, flexible connections between different pieces of hardware.

By managing the design and assembly of this entire ecosystem, Koil provides its client with a single, accountable partner for a critical part of the subsea architecture. This integrated approach minimizes interface risks between components from different vendors, a common source of delays and cost overruns in large-scale offshore projects.

For investors, this contract win solidifies Koil Energy's growth narrative. It adds significantly to a backlog that was already reported at $38.9 million as of late 2023, providing a stable foundation for future earnings. As deepwater producers continue to prioritize efficiency, reliability, and cost-effective field expansion, the demand for specialized integrators capable of delivering turnkey subsea systems is poised to grow. This project not only bolsters Koil's order book but also solidifies its role as a key enabler of the next phase of energy development in one of the world's most vital offshore basins.